P.S. Saminathan has stepped down as chairman of Indian exhibitor Pyramid Saimira following huge losses and a scandal over share price rigging at the company.
The company’s current president N. Narayanan will take up the role of chairman. Saminathan will retain the post of managing director and shift his focus towards company operations.
Saminathan said: “Due to huge business loses, the company has suffered working capital erosion. Further, the global meltdown, national recession and failure in the film industry have put enormous strain on the entire film industry.
“With a view to strengthen the core exhibition business and also to reduce the risk levels in the business and bring back growth and profitability, I have decided to focus more on operational management and hand over chairmanship.”
The Chennai-based company has suffered losses of $21m (Rs1bn) over the past year after expanding too fast from its core business of exhibition. Meanwhile, Saminathan and another investor Nirmal N. Kotecha were barred by the Securities and Exchange Board of India (SEBI) from trading in securities over a fake letter and buyback offer.
Over the past few years, Pyramid has entered several other areas including film production, distribution, gaming and advertising both in India and overseas. It raised around $18m through an IPO in 2006, but was later hit by rising costs and expensive flops such as Kuselan featuring Tamil star Rajnikanth
The company said it will now refocus on exhibition, while producing a few films a year through sister company Pyramid Saimira Production International. It has also approved the proposed merger of its subsidiary Fun Asia USA with another company in a similar business. However it will continue with its expansion plans in Malaysia where it made cash profits.